Calculate business loan payments, total costs, and true APR including fees. Get detailed amortization schedules and comprehensive analysis for business and SBA loans.
Business loans provide essential capital for companies to start, grow, or manage cash flow. Unlike personal loans, business loans often involve complex fee structures and varying payment schedules that affect the true cost of borrowing. Understanding the Annual Percentage Rate (APR) helps businesses compare different loan offers accurately.
The calculator accounts for various compounding frequencies, payment schedules, and fees to provide an accurate assessment of loan costs. This comprehensive analysis helps business owners make informed financing decisions.
| Loan Type | Typical Amount | Interest Rate | Term Length | Best For |
|---|---|---|---|---|
| SBA Loans | $50K - $5M | 6-13% | 10-25 years | Established businesses |
| Term Loans | $25K - $500K | 8-25% | 1-5 years | Equipment, expansion |
| Lines of Credit | $10K - $100K | 10-30% | Revolving | Working capital |
| Equipment Financing | $5K - $5M | 6-20% | 2-7 years | Machinery, vehicles |
| Invoice Factoring | Varies | 1-5% per month | 30-90 days | Cash flow gaps |
Basic interest calculation without fees
True cost including all fees and charges
| Fee Type | Typical Amount | Description |
|---|---|---|
| Origination Fee | 1-6% of loan | Processing and underwriting costs |
| Documentation Fee | $100-$1,000 | Paperwork and legal document preparation |
| Application Fee | $75-$500 | Initial processing fee (sometimes refundable) |
| Prepayment Penalty | 1-5% of balance | Fee for early loan payoff |
| Late Payment Fee | $25-$50 or 5% | Penalty for missed payments |
| Payment Frequency | Payments per Year | Interest Savings | Cash Flow Impact |
|---|---|---|---|
| Monthly | 12 | Baseline | Moderate |
| Bi-weekly | 26 | Moderate savings | Higher frequency |
| Weekly | 52 | Higher savings | Challenging for cash flow |
| Quarterly | 4 | Higher total interest | Easier cash flow |
Credit Score: Personal and business credit history affects rates and terms.
Time in Business: Established businesses typically get better rates than startups.
Annual Revenue: Higher revenue demonstrates ability to repay loans.
Debt-to-Income Ratio: Lower existing debt improves qualification chances.
Collateral: Secured loans often have lower interest rates than unsecured loans.
Prepare comprehensive documentation for faster approval
Market Conditions: Federal Reserve rates influence business loan rates.
Loan Amount: Larger loans may qualify for lower rates due to economies of scale.
Loan Term: Shorter terms typically have lower rates but higher payments.
Industry Risk: Some industries are considered higher risk and face higher rates.
| Payment Timing | Pros | Cons | Best For |
|---|---|---|---|
| Beginning of Month | Predictable timing | May strain cash flow | Service businesses |
| Mid-Month | Spreads cash flow needs | More complex tracking | Retail businesses |
| End of Month | Allows revenue collection | Bunches obligations | B2B businesses |
Rate Improvement: Refinance when rates drop significantly or credit improves.
Term Adjustment: Extend terms to lower payments or shorten to save interest.
Fee Analysis: Calculate if savings exceed refinancing costs.
Timing: Consider business cycles and cash flow when refinancing.
Borrowing Too Much: Taking more than needed increases costs and risk.
Ignoring APR: Focusing only on interest rate ignores total cost.
Poor Timing: Borrowing during weak cash flow periods increases stress.
Inadequate Planning: Not having a clear repayment strategy.